News from the Industry

CA sues another L.A. carwash for labor violations
California Attorney General Edmund G. Brown Jr. has filed a lawsuit seeking $2.6 million in damages from Auto Spa Express, Inc., owner, Jonathan Min Kim, and Sunset Car Wash, LLC, as part of his statewide crackdown on companies that break worker-protection laws.

"Most companies in California comply with state wage and benefit laws, but if you're running a firm that's exploiting your workers in this economy when people are desperate for jobs, we want you to know that we will find you, we will stop you and we will file some of the toughest legal actions in the nation against you," Brown said.

The Underground Economy Unit of the Attorney General’s Office received numerous complaints from employees at Auto Spa Express carwash facility located at 2028 Sunset Blvd., which employed between 23 and 41 people, depending on the time of year. The facility was sold to Sunset Car Wash, LLC earlier this year.

The suit against Auto Spa Express contends that from 2006 to 2008, the company failed to:

Pay the state minimum wage to its employees. Employees were often paid $6.32 an hour; the state's minimum wage is $8.00 an hour. On days when there were no customers, employees sometimes would not be paid at all.

Pay overtime. Employees were often forced to work six days a week, from 8 a.m. to 6 p.m., without overtime pay.

Provide accurate itemized statements of hours and wages to employees. Employees were often paid in cash so that the company would not have to pay into the State Unemployment Fund or withhold pay for state taxes.

Small business outlook is cautious in 2010
Discover's Small Business Watch index rose 1.5 points in December from the previous month. At the same time the number of business owners who think the economy is getting worse fell four percentage points to 49 percent while those who think it has stabilized rose eight points to 24 percent.

The report also noted that a majority of small business owners plan to decrease spending on development activities, compared with 18 percent who say they plan to increase.

The Discover Small Business Watch is a monthly index surveying the economic confidence of 750 U.S. business owners who have less than five employees. It is conducted by Rasmussen Reports LLC.

Are you protected online?
The American Bankers Association and the FBI have some serious advice for you: Start using a dedicated and separate PC to exclusively conduct online banking.

According to those groups, there has been an increase in the number of cyber-robberies targeting small businesses, as well as school districts, churches and other non-profits.

These cyber-robberies rely on malicious programs that can access and manipulate online accounts, but a dedicated PC that's never used for e-mail or Web browsing is much less likely to encounter a banking Trojan.

The FBI has investigated more than 200 cases, mostly in 2008 and 2009, in which cyber-robbers executed fraudulent transfers totaling about $100 million — and successfully made off with $40 million.

QuikTrip makes quick exit from carwash biz
After a failed experiment that played out over the course of five years, QuikTrip has sold all three of its express exterior carwashes to Zip’s Car Wash, based in Jonesboro, AR. Details of the sale were not released.

Two of the washes are in Wichita, KS, while the other is in the Tulsa, OK, market. Previous to this purchase, Zip’s consisted of two locations.

In November of 2008, Professional Carwashing & Detailing reported that QuikTrip had decided the car care business was not a good fit for its chain of over 500 convenience stores in nine states and was dropping plans to continue building any additional washes. At the time, the company said it was considering selling off the existing three in Wichita, KS, and Tulsa, OK.

Workers picket carwash business
In what is becoming a somewhat familiar sight in Los Angeles, carwash workers gathered to picket their employer, accusing him of refusing to negotiate and sign an agreement which supports their right to organize this December.

Owner Glenford Rogers said he follows the stat law and is being unfairly singled out because he has no desire to join a union.

Workers of Santa Palm Car Wash want to sign a contract with the Carwash Workers Organizing Committee to guarantee employees rights such as better wages and safer working conditions.

“We abide by the laws set forth by the state and the labor board,” Rogers said, adding: “There’s no reason to join, we do everything by the law.”

Key Bridge Partners buys carwash product line
Key Bridge Partners, the Bristol, VA-based company that purchased Magic Wand LLC, a carwash manufacturer and supplier, in early 2008, has increased its presence in the carwash industry by acquiring the U.S. Para Plate carwash product line from Circor Aerospace Inc.

The product line includes high pressure valves, regulators, system times and spray gears.

Bob Maruszewski, a partner at Key Bridge, said, “This allows us to have all of our carwash industry knowledge, resources and talent in one place, which has numerous benefits.”

The business transaction was completed on December 17, 2009.

InterClean finishes Olympic wash stations
InterClean Equipment, a manufacturer of specialty heavy-duty wash systems, has recently completed both the new train wash and the new bus wash installations for the cities hosting the 2010 Winter Olympics.

The company finished a train wash system for Canada Line, the new rail service from the Vancouver airport to downtown and to the Olympic village, a few months ago. The system is the first train wash in North America to have its own integrated waste water treatment, oil cracking and water recycling systems.

The company also installed a new InterClean Hybrid bus wash to clean vehicles from the BC Transit-Whistler station, which houses all buses used for outdoor winter Olympic events and is known for its harsh winter conditions.

The entire bus fleet is expected to be washed several times a day during the winter Olympics. The snow and ice build-up in the bus fleet pose some of the most challenging bus wash tasks anywhere.

Setomatic Systems acquires eWash
Setomatic Systems Inc., a supplier of equipment to the coin laundry industry, has acquired the assets of eWash Cashless Payment Systems LLC, manufacturer of cashless payment systems to the carwash industry. The company said its objective is to offer payment technologies to both coin laundry and carwash markets.

Jeffrey North, former CEO of eWash, will stay on with the company.

“This was an obvious choice for us here at Setomatic,” said Setomatic President Michael Schantz. “We have been working closely with eWash for over a decade and like what they bring to the table from the carwash market.”

Costco may add carwash to CA store
Costco’s plans to thoroughly renovate its store here have been unanimously approved, and the company may include a carwash in its expansion.

The company did not specify what type of a carwash was planned for the business, but the chain already has two conveyor washes in operation.

The San Marcos City Council did amend the gas station’s operating hours, but both the gas station and proposed carwash have a conditional use permit which allows them to operate 6 a.m. to 9:30 p.m. Monday through Friday, and 7 a.m. to 8 p.m. on Saturdays and 7 a.m. to 7 p.m. on Sundays.

The company was forced to make additional concessions, including building an 8-foot-high sound wall, in order to alleviate residents’ concerns about noise and traffic at the gas station and carwash.

Costco will keep its current store open until the new store’s opening, which it hopes will happen by spring 2011. Then it will demolish the building.

Mace sells three carwashes in TX
Mace, a company that at one time owned as many as 58 carwashes, has now sold three more facilities located in Austin, TX, bringing the total number of carwashes owned by Mace down to seven and leaving the company with only one carwash left to sell in Texas.

The Genie carwashes sold for $8 million and Mace will net $5.6 million for the sale after paying off $2.15M in debt.

The company, which recently reported a “disappointing” third quarter, said on Nov. 30 that its debt total is under $3 million.

Hydrofluoric acid violation nets $200K fine
Metro Rail will pay $200,000 for cleaning its rail cars more than half a decade ago, thanks to a Clean Water Act violation issued after it was revealed that hydrofluoric acid (HF) was used at its carwashing facility.

The use of HF in the carwash industry has been a hotly-debated topic amongst the industry. Chemical manufacturers (as well as insurance companies) have taken strong positions both for and against the chemical. Professional Carwashing & Detailing has featured numerous articles about the hazards of HF acid and also ammonium biflouride, a similarly dangerous wheel cleaner.

Metro will pay the fine for using the chemical six years ago at its carwashing facility and discharging it into the pipes and sewers belonging to the Washington Suburban Sanitary Commission.

Metro said its carwashing facility now complies with the Clean Water Act.